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Estimate Class Class 5 Class 4 Class 3 Class 2 Class 1

LEVEL OF PROJECT
DEFINITION
0% to 2% 1% to 15% 10% to 40% 30% to 70% 50% to 100%
Expressed as a % of
complete definition
END USAGE Typical
Concept Screening Study or Feasibility Budget Authorization, or Control Control or Bid / Tender Check Estimate or Bid / Tender
Purpose of Estimate
METHODOLOGY Capacity Factored, Parametric Models, Semi-Detailed Unit Costs with Assembly Level Detailed Unit Cost with Forced Detailed Take-
Typical estimating Equipment Factored or Parametric Models Detailed Unit Cost with Detailed Take-Off
method Judgment, or Analogy Line Items Off
EXPECTED
ACCURACY RANGE
L: -20% to -50% H: +30% to +100% L: -15% to -30% H: +20% to +50% L: -10% to -20% H: +10% to +30% L: -5% to -15% H: +5% to +20% L: -3% to -10% H: +3% to +15%
Typical variation in low
and high ranges [a]
PREPARATION
EFFORT Typical
degree of effort relative 1 2 to 4 3 to 10 4 to 20 5 to 100
to least cost index of 1
[b]
Class 5 estimates are generally prepared based on very Class 4 estimates are generally prepared based on very Class 3 estimates are generally prepared to form the basis Class 2 estimates are generally prepared to form a detailed Class 1 estimates are generally prepared for discrete parts or
limited information, and subsequently have very wide limited information, and subsequently have very wide for budget authorization, appropriation, and/or funding. As control baseline against which all project work is monitored in sections of the total project rather than generating this level of
accuracy ranges. As such, some companies and accuracy ranges. They are typically used for project such, they typically form the initial control estimate against terms of cost and progress control. For contractors, this class detail for the entire project. The parts of the project estimated at
organizations have elected to determine that due to the screening, determination of feasibility, concept evaluation, which all actual costs and resources will be monitored. of estimate is often used as the "bid" estimate to establish this level of detail will typically be used by subcontractors for
inherent inaccuracies, such estimates cannot be classified in and preliminary budget approval. Typically, engineering is Typically, engineering is from 10% to 40% complete, and contract value. Typically, engineering is from 30% to 70% bids, or by owners for check estimates. The updated estimate is
a conventional and systematic manner. Class 5 estimates, from 1% to 5% complete, and would comprise at a minimum would comprise at a minimum the following: process flow complete, and would comprise at a minimum the following: often referred to as the current control estimate and becomes
due to the requirements of end use, may be prepared within a the following: plant capacity, block schematics, indicated diagrams, utility flow diagrams, preliminary piping and Process flow diagrams, utility flow diagrams, piping and the new baseline for cost/schedule control of the project. Class 1
REFINED CLASS very limited amount of time and with very little effort layout, process flow diagrams (PFDs) for main process instrument diagrams, utility flow diagrams, preliminary piping instrument flow diagrams, heat and material balances, final estimates may be prepared for parts of the project to comprise a
DEFINITION expended - sometimes requiring less than 1 hour to prepare. systems and preliminary engineered process and utility and instrument diagrams, plot plan, developed layout plot plan, final layout drawings, complete engineered process fair price estimate or bid check estimate to compare against a
Often, little more than proposed plant type, location, and equipment lists. Level of Project Definition Required: 1% to drawings, and essentially complete engineering process and and utility equipment lists, single line diagrams for electrical, contractor's bid estimate, or to evaluate/dispute claims.
capacity are known at the time of estimate preparation. 15% of full project definition. utility equipment lists. Level Of Project Definition Required: electrical equipment and motor schedules, vendor quotations, Typically, engineering is from 50% to 100% complete, and would
10% to 40% of full project definition. detailed project execution plans, resourcing and work force comprise virtually all engineering and design documentation of
plans, etc. the project, and complete project execution and commissioning
plans. Level for Project Definition Required: 50% to 100% of full
project definition.

Class 5 estimates are prepared for any number of strategic Class 4 estimates are prepared for a number of purposes, Class 3 estimates are typically prepared to support full project Class 2 estimates are typically prepared as the detailed Class 1 estimates are typically prepared to form a current
business planning purposes, such as but not limited to such as but not limited to, detailed strategic planning, funding requests, and become the first of the project phase control baseline against which all actual costs an resources control estimate to be used as the final control baseline against
market studies, assessment of initial viability, evaluation of business development, project screening at more developed "control estimate" against which all actual costs and will now be monitored for variation to the budget, and form a which all actual coasts and resources will now be monitored for
alternate schemes, project screening, project location stages, alternative scheme analysis, confirmation of resources will be monitored for variations to the budget. They part of the change/variation control program. variations to the budget, and form a part of the change/variation
END USAGE DEFINED studies, evaluation of resource needs and budgeting, long- economic and/or technical feasibility, and preliminary budget are used as the project budget until replaced by more control program. They may be used to evaluate bid checking, to
range capital planning, etc. approval or approval to proceed to next stage. detailed estimates. In many owner organizations, a Class 3 support vendor/contractor negotiations, or for claim evaluations
estimate may be the last estimate required and could well and dispute resolution.
form the only basis for cost/schedule control.
Class 5 estimates virtually always use stochastic estimating Class 4 estimates virtually always use stochastic estimating Class 3 estimates usually involve more deterministic Class 2 estimates always involve a high degree of Class 1 estimates involve the highest degree of deterministic
methods such as cost/capacity curves and factors, scale of methods such as cost/capacity curves and factors, scale of estimating methods that stochastic methods. They usually deterministic estimating methods. Class 2 estimates are estimating methods, and require a great amount of effort. Class
operations factors, Lang factors, Hand factors, Chilton operations factors, Lang factors, Hand factors, Chilton involve a high degree of unit cost line items, although these prepared in great detail, and often involve tens of thousands 1 estimates are prepared in great detail, and thus are usually
ESTIMATING factors, Peters-Timmerhaus factors, Guthrie factors, and factors, Peters-Timmerhaus factors, Guthrie factors, the may be at an assembly level of detail rather than individual of unit cost line items. For those areas of the project still performed on only the most important or critical areas of the
METHODS USED other parametric and modeling techniques. Miller method, gross unit costs/ratios, and other parametric components. Factoring and other stochastic methods may be undefined, an assumed level of detailed takeoff (forced project. All items in the estimate are usually unit cost line items
and modeling techniques. used to estimate less-significant areas of the project. detail) may be developed to use as line items in the estimate based on actual design quantities.
instead of relying on factoring methods.

Typical accuracy ranges for Class 5 estimates are -20% to Typical accuracy ranges for Class 4 estimates are -15% to Typical accuracy ranges for Class 3 estimates are -10% to - Typical accuracy ranges for Class 2 estimates are -5% to - Typical accuracy ranges for Class 1 estimates are -3% to -
50% on the low side, and +30% to +100% on the high side, -30% on the low side, and +20% to +50% on the high side, 20% on the low side, and +10% to +30% on the high side, 15% on the low side, and +5% to +20% on the high side, 10% on the low side, and +3% to +15% on the high side,
depending on the technological complexity of the project, depending on the technological complexity of the project, depending on the technological complexity of the project, depending on the technological complexity of the project, depending on the technological complexity of the project,
EXPECTED appropriate contingency determination. Ranges could exceed appropriate reference information, and the inclusion of an appropriate reference information, and the inclusion of an appropriate reference information, and the inclusion of an appropriate reference information, and the inclusion of an
ACCURACY RANGE those shown in unusual circumstances. appropriate contingency determination. Ranges could exceed appropriate contingency determination. Ranges could exceed appropriate contingency determination. Ranges could exceed appropriate contingency determination. Ranges could exceed
those shown in unusual circumstances. those shown in unusual circumstances. those shown in unusual circumstances. those shown in unusual circumstances.

As little as 1 hour or less to prepare to perhaps more than Typically, as little as 20 hours or less to perhaps more than Typically, as little as 150 hours or less to perhaps more than Typically, as little as 300 hours or less to perhaps more than Class 1 estimates require the most effort to create, and as such
200 hours, depending on the project and the estimating 300 hours, depending on the project and the estimating 1500 hours, depending on the project and the estimating 3000 hours, depending on the project and the estimating are generally developed for only selected areas of the project, or
methodology used. methodology used. methodology used. methodology used. Bid Estimates typically require more effort for bidding purposes. A complete Class 1 estimate may involve
EFFORT TO PREPARE than estimates used for funding or control purposes as little as 600 hours or less, to perhaps more than 6,000 hours,
(for US$20MM project): depending on the project and the estimating methodology used.
Bid estimate typically require more effort than estimates used for
funding or control purposes.

ANSI Standard Order of Magnitude Estimate; Ratio, ballpark, blue sky, seat- Budget Estimate; Screening, top-down, feasibility, Budget Estimate; Budget, scope, sanction, semi-detailed, Definitive Estimate; Detailed Control, forced detail, execution Definitive Estimate; Full detail, release, fall-out, tender, firm
Reference Z94.2-1989 of-pants, ROM, idea study, prospect estimate, concession authorization, factored, pre-design, pre-study. authorization, preliminary control, concept study, phase, master control, engineering, bid, tender, change order price, bottoms-up, final, detailed control, forced detail, execution
name; Alternate license estimate, guesstimate, rule-of thumb. development, basic engineering phase estimate, target estimate. phase, master control, fair price, definitive, change order
Estimate Names, estimate. estimate.
Terms, Expressions,
Synonyms:
Estimate Class Class 5 Class 4 Class 3 Class 2 Class 1
Estimate Input
Checklist and Class 5 Class 4 Class 3 Class 2 Class 1
Maturity Index
GENERAL PROJECT
DATA
Project Scope
Description General Preliminary Defined Defined Defined
Plant Production /
Facility Capacity Assumed Preliminary Defined Defined Defined

Plant Location General Approximate Specific Specific Specific

Soils & Hydrology None Preliminary Defined Defined Defined

Integrated Project Plan None Preliminary Defined Defined Defined

Project Master Schedule None Preliminary Defined Defined Defined

Escalation Strategy None Preliminary Defined Defined Defined


Work Breakdown
Structure None Preliminary Defined Defined Defined
Project Code of
Accounts None Preliminary Defined Defined Defined

Contracting Strategy Assumed Assumed Preliminary Defined Defined

ENGINEERING
Class 5 Class 4 Class 3 Class 2 Class 1
DELIVERABLES:

Block Flow Diagrams Started / Preliminary Preliminary / Complete Complete Complete Complete

Plot Plans Started Preliminary / Complete Complete Complete


Process Flow Diagrams
(PFDs) Started / Preliminary Preliminary / Complete Complete Complete
Utility Flow Diagrams
(UFDs) Started / Preliminary Preliminary / Complete Complete Complete
Piping & Instrument
Diagrams (P&IDS) Started Preliminary / Complete Complete Complete
Heat and Material
Balances Started Preliminary / Complete Complete Complete

Process Equipment List Started / Preliminary Preliminary / Complete Complete Complete

Utility Equipment List Started / Preliminary Preliminary / Complete Complete Complete


Electrical One Line
Drawings Started / Preliminary Preliminary / Complete Complete Complete
Specifications and
Datasheets Started Preliminary / Complete Complete Complete
General Equipment
Arrangement Drawings Started Preliminary / Complete Complete Complete

Spare Parts Lists Started / Preliminary Preliminary Complete


Architectural Details /
Schedules Started Preliminary / Complete Complete Complete

Structural Details Started Preliminary / Complete Complete Complete


Mechanical Discipline
Drawings Started Preliminary Preliminary / Complete
Electrical Discipline
Drawings Started Preliminary Preliminary / Complete
System Discipline
Drawings Started Preliminary Preliminary / Complete
Civil/Site Discipline
Drawings Started Preliminary Preliminary / Complete

Demolition Details Started Preliminary / Complete Complete Complete


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Estimating Accuracy Curve (Source: Derived from AACE Data; 18R-97)

0% Engineering % 100

Engineering Completion (%)

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